CLA-2 RR:CR:GC 967313 DSS
Port Director
U.S. Customs and Border Protection
10 Causeway St., Rm. 603
Boston, MA 02222
Re: Internal Advice 04/024; polyethylene battery separator material
Dear Port Director:
This is in response to your memorandum dated September 9, 2004, forwarding a request by Kuehne & Nagel Inc., on behalf of Energizer Battery Manufacturing (Energizer or importer), for internal advice (I/A 04/024) on the classification of high-density polyethylene battery separator material under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA). The Chief, Special Products Branch, National Commodity Specialist Division (NCSD) forwarded your memorandum and an accompanying NCSD memorandum, dated October 19, 2004, to our Office.
FACTS:
The instant material is sheeting of high-density polyethylene with a microporous construction. The material is imported on reels in lengths of 1000 meters. The importer states that it is using the material in the manufacture of lithium batteries as a battery separator. According to the importer, the purpose of a battery separator is to prevent the battery from shorting out by separating the lithium metal anode (negative electrode) and the iron disulfide cathode (positive electrode). The separator prohibits the direct contact of the anode and cathode materials.
The separator material is imported in two grades. One grade has a thickness of 20 microns and is 44 mm wide; it is used with AA batteries. The other grade has a thickness of 19 microns and is 39 mm wide; it is used with AAA batteries.
After entry, the batteries are manufactured. The three materials, the anode, separator and cathode, which are on separate reels, are placed on a winding machine. They are stacked and wound jellyroll fashion. Once the three-layer roll has been wound to the desired specification, it is cut and placed inside the “can” of the battery. There are no markings on the material to indicate the number of separators to be made from the material.
You believe the material is classified under subheading 3920.10.00, HTSUS, as “Other plates, sheets, film, foil and strip, of plastics, noncellular and not reinforced, laminated, supported or similarly combined with other materials: Of polymers of ethylene.”
The importer seeks classification under subheading 8506.90.00, HTSUS, as “Primary cells and primary batteries; parts thereof: Parts,” or alternatively under subheading 3921.19.00, HTSUS, as “Other plates, sheets, film, foil and strip, of plastics: Cellular: Of other plastics.”
ISSUE:
Whether the instant material imported on rolls is classifiable as parts of a primary battery under heading 8506, HTSUS.
LAW AND ANALYSIS:
Classification under the HTSUSA is made in accordance with the General Rules of Interpretation (GRIs). GRI 1 provides that the classification of goods shall be determined according to the terms of the headings of the tariff schedule and any relative section or chapter notes. In the event that the goods cannot be classified solely on the basis of GRI 1, and if the headings and legal notes do not otherwise require, the remaining GRIs may then be applied.
The Harmonized Commodity Description and Coding System Explanatory Notes (ENs) constitute the official interpretation of the Harmonized System at the international level. While not legally binding, the ENs provide a commentary on the scope of each heading of the HTSUSA and are thus useful in ascertaining the classification of merchandise under the System. The Bureau of Customs and Border Protection (CBP) believes the ENs should always be consulted. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
The HTSUSA provisions under consideration (2004) are as follows:
3920 Other plates, sheets, film, foil and strip, of plastics, noncellular and not reinforced, laminated, supported or similarly combined with other materials:
3920.10.0000 Of polymers of ethylene . . .
* * * *
3921 Other plates, sheets, film, foil and strip, of plastics:
3921.19 Cellular:
3921.19.0000 Of other plastics . . .
* * * *
Primary cells and primary batteries; parts thereof:
8506.90.0000 Parts. . .
An article may be classified as a part of another article when, in its imported condition, it has been so far advanced so as to be dedicated to and commercially fit for use with that article and incapable of being made into more than one article or class of articles. See Avin Industrial Products Co. v. United States, 72 Cust. Ct. 43, C.D. 4503, 376 F. Supp. 879, reh. denied, 72 Cust. Ct. 147, C.D. 4522 (1974). See also Haraeus-Amersil, Inc. v. United States, 640 F. Supp. 1331 (CIT 1986) (so advanced that nothing remained to be done except cut precious metal contact tape apart); EM Chemicals v. United States, 728 F. Supp. 723 (CIT 1989) (liquid crystal used in liquid crystal displays imported in advanced manufactured state such that the product as imported is ready to be a part of the LCD by being sandwiched between two ‘plates’), and Ludvig Svensson, Inc. v. United States, 62 F. Supp. 2d 1171 (CIT 1999), infra.
The question of whether an item made into multiple parts after importation is classifiable as a part of another article was addressed in Baxter Healthcare Corp. of Puerto Rico v. United States, 182 F.3d 1333 (Fed. Cir. 1999) (hereinafter Baxter). In Baxter, the disputed merchandise was monofilament imported in rolls for use in oxygenators. In Baxter, the court stated:
[W]hether an imported item that is made into multiple parts after import is classifiable as "parts" of other articles under the HTSUS involves two questions. First, the item must be dedicated solely or principally for use in those articles and must not have substantial other independent commercial uses. See Bauerhin, 110 F.3d at 779. If the item has substantial other commercial uses, "it is a distinct and separate commercial entity," not a part. Id. (quoting United States v. Willoughby Camera Stores, Inc., 21 C.C.P.A. 322 (1933)). In this case, it is undisputed that Oxyphan® has no commercial use other than making membrane oxygenators and therefore is "dedicated" to such use.
Second, if the item as imported can be made into multiple parts of articles, the item must identify and fix with certainty the individual parts that are to be made from it. See The Harding Co. v. United States, 23 C.C.P.A. 250, 253 (1936). In Harding, our predecessor court held that an imported item made from asbestos yarn, wire, and a mixture of other materials, used for the sole purpose of making brake linings, was properly classified as a manufacture of yarn rather than as a "part" of an automobile because the individual brake lining parts to be made from it were not identified or otherwise "fixed with certainty"; rather, the item had to be individually cut to custom fit each brake shoe made. See id. at 252-53. "In the condition as imported, the long roll of brake-lining material has in no manner been dedicated to the making of any particular brake lining. To be a part of an automobile, that is a brake lining, it must be more than mere material for making a brake lining." Id. at 252. In this case, it is undisputed that each roll of Oxyphan® contributes material to approximately four oxygenators. At the time of import, the individual parts cannot be discerned from the roll, and the roll nowhere marks or otherwise identifies the individual parts to be made from it. Rather, Baxter individually cuts lengths of Oxyphan® from a roll and custom-fits them around a steel bellows. The exact length needed per oxygenator is not known until the oxygenator is made. Because the individual parts are not identifiable or fixed at the time of import, Oxyphan® cannot be classified as a "part" of an oxygenator.
Id. at 1338-1339. Like the Oxyphan® material in Baxter, the instant merchandise is a specialized material, but is not fixed with certainty as a part. The instant material is imported in rolls and is cut to specific sizes and shapes after entry. No objective assessment of the number of separators can be gleaned from the material as imported, as the rolls are not marked to indicate where individual parts are to be made from it. Like the Oxyphan® material in Baxter, the separators are cut from the material with some material left over. Accordingly, the dimensions, and therefore, the identity, of the article to be made from the imported goods is neither fixed nor certain. Therefore, according to the first part of the test applied in Baxter, those goods cannot be considered a "part" of the battery.
Furthermore, the information in the file indicates the instant material (unlike the Oxyphan material in Baxter) has other uses, most notably as filtering material. Thus, the material fails the second part of the test applied in Baxter.
A description from the manufacturer describes the material as:
This microporous film “SETELA” is made from a uniquely designed high-density polyethylene and made by a unique plastics fabrication technique. It provides an ultra-fine network of interconnected micropores through the matrix.
This results in high performance and high functional separation and filtration material (battery separator, filter, etc.) using a unique combination of micropore, porosity, thickness, and strength. . . . (emphasis added).
This product information shows that the film has at least two functions, one as a battery separator, and one as filtering material. Thus, the identity of the rolls of polyethylene material as parts of batteries is not fixed with certainty because the material is capable of multiple uses. Based on the application of Baxter, we find that the material is not classifiable as a part under heading 8506, HTSUS.
We next examine headings 3920 and 3921, HTSUS, to determine which describes the imported material. The imported material meets the definition of “plates, sheets, film, foil and strip” provided in Note 10 to Chapter 39, which states:
In headings 3920 and 3921, the expression “plates, sheets, film, foil and strip” applies only to plates, sheets, film, foil and strip (other than those of chapter 54) and to blocks of regular geometric shape, whether or not printed or otherwise surface-worked, uncut or cut into rectangles (including squares) but not further worked (even if when so cut they become articles ready for use).
The issue is whether the material is cellular plastic. The instant material is described as microporous. The ENs to Chapter 39 state, in relevant part:
Cellular plastics
Cellular plastics are plastics having many cells (either open, closed or both), dispersed throughout their mass. They include foam plastics, expanded plastics and microporous or microcellular plastics. They may be either flexible or rigid.
Thus, the material is considered a cellular plastic for tariff purposes. Heading 3920 provides for noncellular plastics. Therefore, the instant material meets the terms of heading 3921, HTSUS, as other plates, sheets, film, foil and strip of plastics.
Indeed, based on the foregoing, the instant high density polyethylene material imported in rolls is classified in subheading 3921.19.0000, HTSUSA, which provides for "Other plates, sheets, film, foil and strip, of plastics: Cellular: Of other plastics."
HOLDING:
The instant high density polyethylene material imported in rolls is classified in subheading 3921.19.0000, HTSUSA, the provision for "Other plates, sheets, film, foil and strip, of plastics: Cellular: Of other plastics." The 2004 column one, general rate of duty is 6.5 percent ad valorem.
Duty rates are provided for convenience and are subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on the Internet at www.usitc.gov.
This decision should be mailed by your office to the internal advice requestor no later than 60 days from the date of this letter. On that date, the Office of Regulations and Rulings will make the decision available to CBP personnel, and to the public on the Customs and Border Protection Home Page on the World Wide Web at www.cbp.gov, by means of the Freedom of Information Act, and other methods of public distribution.
Sincerely,
Myles B. Harmon, Director
Commercial Rulings Division